considering its replacement. This centrifuge has a current market value of $30,000 and can be used for an additional 5 years, with the market value of zero at the end of 5 years. Maintenance and operating costs are $15,000 a year. A new centrifuge, that could be purchased as a replacement for the current one, costs $80,000. In 5 years, the market value of the

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Production Budget

A budget can be defined as a financial plan designed by an undertaking for a definite period in the future that can contribute towards enhancing the financial success of the business undertaking. It is used to estimate the revenue and expenses. The budget generally takes into account both current and future income and expenses.